An overview of developments in Asia - Marigold Norman - Illegal Logging ...
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An overview of developments in Asia Marigold Norman Chatham House June 19th 2017
Why are these developments happening now and why are they important? Why Now? • Increased consumer concern for illegal logging and imported deforestation; • Import control measures are a key component of Voluntary Partnership Agreements (VPAs). Why is this important? • Asian markets are increasing in global importance.
Global imports of timber, pulp + paper and
furniture products 2009-2016 (netweight in kg)
Source: Data from UN Comtrade, 2017. Compiled by Forest Trends, 2017Japan Legislation: Act on Promotion of the Distribution and Use of Legally Logged Wood (Clean Wood Act) 2016. Consultation on draft basic policy and two ordinances on Due Diligence and enforcement in March 2017. These three implementing regulations were adopted May 1st with no changes. Date in force: May 20, 2017.
The Republic of Korea Legislation: The 2012 Forest Act committed to exclude illegal wood from the Korean market. A revised act on the use of sustainable timber was published in March 2017. Date in force: The law will come into effect on September 22, 2017 although the import provisions will largely come into effect on March 22, 2018.
Malaysia Legislation: Director General (DG) Circular (LPKM 1/155/1/1Vol.4(45)) in 2015 announced a New Import Regulation Under the Timber Legality Assurance System (TLAS). Amendments in May and July 2016 extended the grace periods for the implementation of timber import legality regulations. The legislation only applies to Peninsular Malaysia. Date in force: June 15, 2017.
Indonesia Legislation: Regulation No.97 from 2014 sets out the overarching legal framework and sets up the requirement on importers to seek import approval to meet the import control requirements of the VPA with the EU. Implementing regulations on Due Diligence were released in 2015. Date in force: The import control system has been in effect since January 1, 2016.
Vietnam Legislation: Vietnam has included provisions to regulate imports of timber as part of the VPA with the EU which was initialed in May 2017. Further implementing regulations are forthcoming including legislation requiring importers to conduct Due Diligence. Date in force: Still to be decided.
Key comparative characteristics 1. Is the legislation voluntary or mandatory? * Although in the case of Japan, “the responsible minister can demand a report on the situation of the securing of the use of legally harvested timber, etc. from any timber-related business operator, regardless of whether the business operator is registered or not”
Key comparative characteristics 2. Which actors are covered within the scope of the regulation? *In the case of Korea, the exact actors covered remains unknown, although the provisions are likely to apply to all importing companies.
What are the main timber products imported
by the five Asian markets?
Source: Data from UN Comtrade, 2017. Compiled by Forest Trends, 2017Key comparative characteristics
3. Which timber products are covered by the regulation?
Japan Republic of Korea Malaysia Indonesia Vietnam
“Wood (excluding that which Sawn wood, The regulation The import regulation The import regulation
was collected or discarded preserved wood, applies to the import applies to the list set out applies to all timber
after having been used once dricon, wood plastic of logs and plywood in annex 1 of the MOT and rubber wood
or without use as well as that composite wood, (referring to the import products entering
which uses these as laminated timber, custom HS codes regulation NUMBER 97/ Vietnam.
materials)” and furniture, plywood, particle 4403 and 4412) only. M-DAG/PER/11/2015.
paper and other processed board, fiberboard,
products. oriented strand board,
wood flooring, wood
pellet, wood chip,
wood briquet, modeled
charcoal, charcoal.Key comparative characteristics
4. What is the legislative requirement, what are regulated importers
expected to do?
Japan Republic of Korea Malaysia Indonesia Vietnam
Registered businesses to Importers to document Importers to document Registered importers Importers to carry out Due
carry out Due Diligence with the legality of timber the legality of timber (traders and Diligence and document the
an appropriate confirmation imports. The scope of imports. “Legal” is not processing operators) legality of the timber in
of legality. the legality definition defined in the legislation to carry out Due accordance with the relevant
appears to include legal but compliance options Diligence and to legislation of the country of
right to harvest and vary widely in scope as document the legality harvest covering Rights to
potentially the legal right evidenced in the of the timber imports. harvest; Forestry activities;
to export. documents accepted as Due Diligence is Taxation and fees; Trade
proof of legality. required at the and customs including any
relationship level legal requirements for timber
between the importer export in the country of
and the exporter. harvest such as export bans,
export licensing
requirements, etc.Key comparative characteristics
5. What are the stated penalties?
Japan Republic of Korea Malaysia Indonesia Vietnam
Non-registered The regulation states that None listed. As the No criminal Depending on the severity of
companies declaring when the director of the KFS checks are pre-import, sanctions. the violation, administrative
that they are identifies illegal wood on the failure to document Indonesia is sanctions, suspension of
“registered operators market, the sale will be legality would be taking a relatively activities and/or prosecution will
in timber related suspended and the timber will expected to result in no soft approach apply. Penalties are expected to
business” will be either be returned or import license issued by that promotes be adequate, proportional and
subject to penalties. discarded. Failure to comply the Licensing Unit. good behaviour, dissuasive with harsher
with the order to suspend, with failure to penalties for repeated non-
return or discontinue the sale comply compliance. Legislation still
could lead to up to three years preventing needs to be developed on
imprisonment or a fine of no access to the penalties for non-compliance
more than 30 million Won supply chain. with the future legislation that
(approx. US$27,000). will require importers to conduct
due diligence.Thank you
Marigold Norman
Senior Advisor
mnorman@forest-trends.org
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